The present invention relates generally to the packaging and activation of stored value cards. More particularly, the present invention relates to various methods of packaging open loop cards which are effective to offset the fees associated with their activation and provide further incentives to retailers for offering and promoting their sale.
Open loop cards gift cards have obtained a wide acceptance in the marketplace. Open loop cards are either network branded cards available to be used at participating merchants, or private label cards available for use at select or even single merchants. To obtain the card, a consumer takes the card off of the shelf and presents the card to the cashier. The cashier for the retailer then swipes or scans the control number which is then transmitted to a host to activate the card. The host identifies the control number, and activates the open loop account number linked on the host system. The retailer receives an approval message from a host system authorizing the request for either the amount predefined on the card, or the amount requested in the original message. Unfortunately, a fee is typically assessed to purchase these types of cards that are available for use on the payment network.
Open loop gift cards offer convenience, but at a price. A consumer pays an activation fee that can equal ten to fifteen percent of the value of the card. These activation fees in effect increase the cost of providing the gift, but provide no tangible benefit to either the purchaser or receiver of the card. Additionally, retailers who sell these cards have little control or ability to differentiate their services in the marketplace. Thus competition relative to performance and service is hindered. To lower the overall cost to the consumer, and allow sellers to differentiate themselves in the marketplace, a new and improve method of activating these cards is required.